Vijay Kumar Jain V. Union Of India And Ors

CW/1307/2002

AI Insights

The case involves Vijay Kumar Jain, the petitioner, who challenged the confiscation of gold biscuits and the imposition of a penalty by the Customs authorities. The gold biscuits were seized by DRI officers in Guwahati under the Customs Act, 1962, during an attempt to transport them from Mumbai to Shillong. The petitioner argued that the confiscation was illegal and without jurisdiction, claiming that the burden of proof was on the respondents to show that the gold was smuggled. The respondents contended that the gold was indeed smuggled, supported by statements from co-accused and evidence of the gold's concealment. The High Court, however, did not reach a decision on these substantive issues due to a lack of jurisdiction, as the events occurred outside Rajasthan.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 817433 (HC-RAJASTHAN)
• Appeal Type: Others
• Pronouncement Date: 21-03-2024
• Assessment Year: misc
• Other Referred Cases: PR. Commissioner of Income Tax Jaipur-2 vs. Shri Sanjay Chhabra, Commissioner of Customs vs. Ganpati Overseas, Mitta Sunil Kumar vs. Commissioner of Customs, Balwant Raj Soni vs. Commissioner of Customs, Commissioner of Customs vs. Bajrang Ingole, Union of India vs. Dhanak M. Ramji, Manoj Kumar Sharma vs. Union of India & Ors, Commissioner of Customs vs. Mehboob, Abdul Hussain Saifddin Hamid vs. State of Gujarat, Romesh Chandra Mehta vs. State of West Bengal, Naresh J. Sukhawani vs. Union of India, Surjeet Singh Chhabra vs. Union of India, State of Rajasthan & Ors. vs. Swaika Properties and Ors, Daya Shanker Bhardwaj vs. Chief of the Air Staff, New Delhi and ors, M/s. Divya Upchar Sansthan and Ors. vs. Directorate General of Goods and Service Tax Intelligence and Ors
• Laws Referred To: Customs Act, 1962
• Result in Favour of: Revenue
• Court: HIGH COURT
• Department Lawyers: RAJVENDRA SARASWAT
• Assessee Lawyers: HARSHVARDHAN SINGH; BHAVIT SHARMA; SIDDHARTH RANKA; NK JAIN
• Keywords: Confiscation of gold; Customs Act; Jurisdiction; Penalty; Smuggling
• Section: 112; 125; 111; 123(1)(b)

Judgement Text

"[2024:RJ-JD:10455-DB] HIGH COURT OF JUDICATURE FOR RAJASTHAN AT JODHPUR D.B. Civil Writ Petition No. 1307/2002 Vijay Kumar Jain ----Petitioner Versus Union Of India And Ors ----Respondent For Petitioner(s) : Mr. Harshvardhan Singh Mr. Bhavit Sharma Mr. Siddharth Ranka, through VC Mr. N.K. Jain, through VC For Respondent(s) : Mr. Rajvendra Saraswat HON'BLE DR. JUSTICE PUSHPENDRA SINGH BHATI HON'BLE MR. JUSTICE MUNNURI LAXMAN Judgment Reserved on 28/02/2024 Pronounced on 21/03/2024 1. This writ petition has been preferred claiming the following reliefs: “(i) Quash the impugned order dated 13-8-97 for confiscation of gold and levy of penalty on the petitioner passed by the respondent no.3. (ii) Quash the impugned orders dated 8-5-2001 & 12-2- 2002 passed by the CEGAT, respondent no.2. (iii) Hold that the confiscation of the gold and the levy of penalty in the case of the petitioner is illegal and/or without jurisdiction. (iv) Hold that the burden lies on the respondents to establish that the seized gold was smuggled in nature and there was violation of the Customs Act, 1962 by the petitioner. [2024:RJ-JD:10455-DB] (2 of 9) [CW-1307/2002] (v) Direct the respondents to forthwith release the seized gold in question to the petitioner. (vi) Any other appropriate relief/reliefs as may be considered just and necessary by the Hon’ble Court in the facts and circumstances of the case to do complete justice to the petitioner. (vii) The cost of the writ petition may be kindly awarded.” 2. Brief facts of the case as placed before this Court by the counsel for the petitioner are that the petitioner had bought eleven gold biscuits from M/s Sanghvi Enterprises, Mumbai on 27.01.1996 whereafter the said gold biscuits were sent to Shillong for the purpose of sale to Mr. G.C. Goyal in the hands of Mr. Abdul Rahim. However, Mr. G.C. Goyal and Sanjay Goyal were found to be out of station thus Mr. Abdul Rahim decided to return back but on the way back he was intercepted by D.R.I. Officers, Guwahati whereby the gold biscuits were seized under violation of the Customs Act, 1962 (hereinafter referred to as ‘Act of 1962’). 2.1. During the period of custody, Mr. Abdul Rahim was interrogated and gave his statements whereafter a search was conducted at the house of Shri Sanjay Kumar Goyal and his statements were also recorded however both Abdul Rahim and Shri Sanjay Kumar Goyal retracted their respective statements. Thereafter the petitioner’s statements were also recorded on 22.02.1996 in Jodhpur and on 17.07.1996 a show cause notice was issued by the respondent no.3 regarding seizure of the aforesaid gold biscuits and accordingly a reply to the same was submitted on 29.11.1996. [2024:RJ-JD:10455-DB] (3 of 9) [CW-1307/2002] 2.2. Subsequently an order dated 13.08.1997 came to be passed by the Commissioner of Customs (Preventive) N.E.R., Shillong for confiscation of the seized gold biscuits under Section 111 of the Act of 1962 and further under Section 112 of the said Act, a penalty of Rs. 50000/- came to be levied upon the petitioner. Aggrieved of this order the petitioner preferred an appeal before the learned Customs Excise & Gold (Control) Appellate Tribunal, New Delhi (CEGAT) and vide order dated 08.05.2001 the order dated 13.08.1997 was upheld whereafter a rectification application was filed against the order of CEGAT and the same also came to be rejected on 12.02.2002. 3. Learned counsel for the petitioner submitted that undue reliance was placed upon the statements given by co-accused persons whose statements had been recorded under duress and coercion, even though the said statements were retracted at the earliest possible opportunity after the co-accused were set free on bail. 3.1. It was further submitted that the petitioner had clarified regarding the purchase of gold biscuits from M/s. Sanghvi Enterprises, Mumbai wherein by mistake the mother of the petitioner had given invoice of another purchase of gold biscuits from M/s. Kishanlal & Sons to Mr. Abdul Rahim and thus at the time of being intercepted by the DRI Officers, Guwahati, Mr. Abdul Rahim was not carrying the correct invoice. 3.2. In furtherance, an affidavit of the proprietor of M/s Sanghvi Enterprises was also filed, to confirm the above said transaction [2024:RJ-JD:10455-DB] (4 of 9) [CW-1307/2002] and such affidavit was never controverted or rebutted, furthermore, there are no cogent material to support the findings arrived by the respondents. 3.3. Learned counsel further submitted that the present matter lies within the jurisdiction of this Hon’ble Court under Article 226 of the Constitution of India, as the gold biscuits in question were, after being purchased at Bombay, brought to Jodhpur (Rajasthan), and from Jodhpur, they were supplied at Shillong (Meghalaya) and the statements of the petitioner were also recorded at Jodhpur (Rajasthan) itself. 3.4. It was also submitted that as per as per Section 123 (1) (b) of the Act of 1962 the petitioner had sufficiently established that he was the owner the said gold biscuits, and under Section 125 of Act of 1962 the gold biscuits being dutiable goods and not prohibited good as per the definition under Section 2 of the Customs Act, 1962, the adjudicating officer had an obligation to give the option of payment of fine in lieu of confiscation of gold biscuits as enumerated in plethora of judgments of the Hon’ble Apex Court thus both the respondent authorities had erred in not granting appropriate relief to the petitioner. 3.5. Learned counsel in order to fortify his submissions placed reliance on the following judgments: (a) PR. Commissioner of Income Tax Jaipur-2 vs. Shri Sanjay Chhabra, (D.B. Income Tax Appeal No.22/2023, decided by this Hon’ble Court at Jaipur Bench on 06.04.2022); [2024:RJ-JD:10455-DB] (5 of 9) [CW-1307/2002] (b) Commissioner of Customs vs. Ganpati Overseas, (Civil Appeal No.4735-4736 of 2009, decided by the Hon’ble Apex Court on 06.10.2023); (c) Mitta Sunil Kumar vs. Commissioner of Customs, (Customs Appeal No.30211/2023, decided by the learned CESTAT, Hyderabad on 08.11.2023); (d) Balwant Raj Soni vs. Commissioner of Customs, (Customs Appeal No.75414/2022, decided by the learned CESTAT, Kolkata on 18.12.2023); (e) Commissioner of Customs vs. Bajrang Ingole, (Customs Appeal No.75026/2021, decided by the learned CESTAT, Kolkata on 03.11.2023). (f) Union of India vs. Dhanak M. Ramji, (Writ Petition No.1700/2009, decided by Hon’ble Bombay High Court on 01.09.2009; (g) Manoj Kumar Sharma vs. Union of India & Ors. (D.B. CWP No. 12001/2020 decided by a Division Bench of this Hon’ble Court on 17.02.2022); and (h) Commissioner of Customs vs. Mehboob, (D.B. Civil Writ Petition No.5640/2019 decided by a Division Bench of this Hon’ble Court on 22.02.2022). 4. On the other hand learned counsel for the respondents while opposing the submissions made on behalf of the petitioner submitted that the present petition is liable to be dismissed for want of territorial jurisdiction as no part of cause of action arose in [2024:RJ-JD:10455-DB] (6 of 9) [CW-1307/2002] the State of Rajasthan since the gold biscuits were confiscated at Guwahati, the enquiry had been held at Guwahati and Shillong, the charges had been framed at Shillong and further the order dated 13.08.1997 was also passed by Commissioner of Customs at Shillong. 4.1. It was further submitted that the gold biscuits so confiscated by the DRI Officers had been smuggled and were actually being brought by Abdul Rahim hidden beneath a water flask while being wrapped in a newspaper, furthermore Abdul Rahim himself had confessed to the fact that he was a carrier for the petitioner and had been given the said gold biscuits by Mr. Sanjay Goyal, thus the petitioner’s elaborate story of having purchased the gold biscuits from M/s. Sanghvi does not hold. 4.2. It was further submitted that statements of Mr. Sanjay Goyal had also been recorded wherein it had been admitted that the gold biscuits wrapped in khasi newspaper and hidden in the specially designed water flask had been delivered to Abdul Rahim by him only. 4.3. It was also submitted that though the statements given by both Abdul Rahim and Sanjay Goyal had been retracted however the said statement had been retracted after a delayed periodand further the statements recorded under Sections 107 and 108 of Act of 1962 are not equivalent to statements recorded under Section 161 of Cr.P.C. and thus such statements are material piece of evidence collected by the Customs Officer. [2024:RJ-JD:10455-DB] (7 of 9) [CW-1307/2002] 4.4. In furtherance concurring views had been given by both the Customs Commissioner and the CEGAT, New Delhi. 4.5. Learned Counsel had placed reliance on the following judgments: (a) Abdul Hussain Saifddin Hamid vs. State of Gujarat (Special Civil Application No. 15689/2000, decided on 11.12.2020); (b) Romesh Chandra Mehta vs. State of West Bengal (Criminal Appeals Nos. 27, 45, 46 and 47 of 1968, decided on 18.10.1968) by the Hon’ble Apex Court; (c) Naresh J. Sukhawani vs. Union of India (Spl. Leave Petn. (c) No. 23708 of 1995, decided no 06.11.1995) by the Hon’ble Apex Court; (d) Surjeet Singh Chhabra vs. Union of India (Special Leave Petition (c) No. 14028/1996, decided on 25.10.1996) by the Hon’ble Apex Court; (e) State of Rajasthan & Ors. vs. Swaika Properties and Ors. (Civil Appeal No.2085/1985, decided on 08.04.1985) by the Hon’ble Apex Court; and (f) Daya Shanker Bhardwaj vs. Chief of the Air Staff, New Delhi and ors. (Civil Misc. Writ Petition No.8014/1985, decided on 10.09.1987) by the Hon’ble Allahabad High Court; and (g) M/s. Divya Upchar Sansthan and Ors. vs. Directorate General of Goods and Service Tax Intelligence and Ors. (D.B. Civil Writ Petition No.8526/2022, decided on 07.08.2023) by this Hon’ble Court. 5. Heard learned counsel for the parties as well as perused the record of the case alongwith the judgments cited at the Bar. 6. At the outset it is made clear that the following observations of the Court are not being made on merits of the case. [2024:RJ-JD:10455-DB] (8 of 9) [CW-1307/2002] 7. This Court observes that the gold biscuits in question being transported by the carrier (Abdul Rahim) of the petitioner were confiscated by the DRI Officers while on a bus from Guwahati and the enquiry proceedings were carried out in Guwahati and Shillong, statements of the involved persons were taken whereafter the case was brought before the Customs Commissioner, Shillong (Meghalaya) and thereafter the said case was heard at length and the order dated 13.08.1997 came to be passed wherein the gold biscuits in question were held to be smuggled by the involved persons and penalty was accordingly imposed; aggrieved by this order the petitioner went before the CEGAT, New Delhi (appellate authority) however vide order dated 08.05.2001 the order passed by Customs Commissioner was upheld and even the rectification application came to be rejected on 12.02.2002 whereafter the petitioner preferred the present writ petition. 8. This Court thus observes that the preliminary objection of the respondent regarding the territorial jurisdiction of this Court deserves acceptance and the same is hereby accepted, because after a perusal of the record as a whole, it is clear that the entire proceedings, including confiscation, recording of the statements, hearing of the case etc. were conducted at Shillong (Meghalaya), and that, the gold biscuits i.e. the articles in question, never reached the territory of the State of Rajasthan. 8.1. Therefore, only on count of the fact that the residence of the petitioner is situated in the State of Rajasthan, the territorial [2024:RJ-JD:10455-DB] (9 of 9) [CW-1307/2002] jurisdiction does not lie with this Court. While making such observations, this Court is conscious of the fact that the present matter is quite old, but the same also cannot persuade this Court to hear and decide the case on its own merits, for lack of jurisdiction, and that, in reiteration, not even a fraction of the cause of action arose in the State of Rajasthan, so as to persuade this Court to make the effective adjudication of the case. Moreover, no interim order is operating in the present case. 9. Thus, in light of the aforesaid observation and looking into the factual matrix of the present case, this Court does not find it a fit case so as to grant any relief to the petitioner in the present petition. 10. The present petition is accordingly disposed of, with liberty to the petitioner to avail the remedy before the Court of competent jurisdiction, strictly in accordance with law. However, it is made clear that the limitation period for the petitioner for the purpose of availing such remedy shall be counted from the date of receipt of a certified copy of this judgment. All pending applications stand disposed of. (MUNNURI LAXMAN),J (DR. PUSHPENDRA SINGH BHATI),J SKant/- "